Who are you? Why are you in this business? What is your approach? Get ready for those questions cause’ that’s what investors care about.
Entrepreneurs have awareness to spot opportunities, the creativity to innovate, the confidence to take risks and the tenacity to turn concepts into successful businesses. Entrepreneurs represent every field imaginable, and many of their ideas have helped shape industries and the world we live in. If you want to build a successful business and score funding, who better to seek for advice and wisdom than the investors? They have a wealth of experience and know what separates the winners from the losers.
So I decided to have an short interview with Hui Woon Tan to see what investors are looking for in companies and who they invest upon. Mrs. Hui Woon currently runs Alley 51, a venture builder which helps to build startups together with the founders. She’s been living in Vietnam for 8 years and she’s one of the first to invest in the well-known coffee franchise, The Coffee House.
Mrs. HuiWoon believes a market that has problems to solve is a place of great business opportunities, whether it’s problem about health, job opportunity or education. And Vietnam is that kind of potential market.
“Everything is a potential if people can actually see the need or problem to be solved.”
What special about Vietnam is the youthful community with inexhaustible energy which translates into passion and hungriness. “People here are young enough to still see the world with ideal and hope.”
According to Hui Woon, for each investment, investors look at three main things.
People — What is the team and what have you done?
How have your careers progressed to the point where you are now uniquely qualified to build this business together today? Investor wants to know whether it’s a well-balanced team embracing diverse talents and styles, yet sharing the same value and vision for what they want to achieve together.
The Royals is one of the best diversity case study. The Royals was named Best Employer — under 100 employees at the 2017 B&T Awards. With around 80 employees who hail from 15 different countries and speak 12 different first languages, and with a 50/50 gender split, including in its senior leadership team, it seems The Royals are walking the talk. They also hire people from a range of backgrounds, and count a marine biologist, ex-journalists, lawyers, a criminologist and accountants as staff members.
Dan Beaumont, managing partner, said that “Diversity is important because a lack of it means a lack of relevance.” He also added that the diverse culture has allowed them to think in a diverse way for their clients and be able to do a diverse range of work. If the company’s employees are not diverse enough to reflect their audience, underrepresented communities will continue to be underrepresented or ignored. That’s a huge loss of benefit.
Approach — How you approach the problems, the solutions you are doing and the organization you are building up.
The right approach can mean a world of difference in business. Part of setting up a long-term plan is knowing where the problem spots are, as well as which business philosophies work better for which industries. That’s why having a strong group of peers and mentors is so important for leaders, an outside perspective, or someone who has already faced a similar misstep, can mean all the difference between struggling and finding success.
Purpose aka. the big WHY — Why you are starting the business, what drives you to do it.
The greatest thing that not many people consider is the why. Why you’re in the business and why you’re starting up (professionally and personally). Huiv Woon always asks startups: “How big you want your company to be?”. And that will determine how you take the business to the next level as well as what you should put focus on. The why is really important.
“If it’s just purely for financial purpose/money, I don’t invest in those kinds of company.”
Hui Woon believes what makes a business grow sustainably is their reason of existence. It should be about doing something good serving the people and the community.
Doing Good Business by Doing Good is no longer an unusual concept. It not only attracts and convinces investors but employees as well. The millennial generation, which now makes up the largest part of the workforce, is characterized by a desire for purpose. They want their employment to mean something. Sitting in a cubicle for the sake of pure profit and an occasional profit isn’t on their agenda.
One of the top startups in 2013, Ranku, a marketplace for online degrees from traditional universities, has incorporated social responsibility at the core of their company. Philanthropic strategies and strong shared values were particularly important when it came to finding investors who would want to work with them. Today, Mark Cuban and Microsoft are some of their largest investors. “I think it [social responsibility] should be a part of every business, even in the smallest way,” said Kim Taylor, co-founder and CEO at Ranku.
From that vision, you can sustainably build something that really matters. It is a strategy for the long term health of a company. “Creating something that matters is table stakes for getting your name on the map. Forget news for the sake of news; focus on being recognized for your impact. Consider why your idea is game-changing, then relentlessly build toward your vision.” — Sarah Hodges, partner, Pillar VC .
On the other hand, we all know that even the best product needs a nice packaging. That’s one thing you should never forget. Design is everything. “Design is a visual language to let your consumer know what value you’re gonna deliver to them.” If your company lacks resources in that area you can have professionals to help you with it. Design should be the last but not least step to complete your product.
So, are you confident with your answers to those million-dollar questions? Stay tuned next week when we interview a successful startup that have been well funded and see if they have a clear answer to these questions.
If you want to know more about Hui Woon and her business, go to alley51.com.